The Perimeter Marketplace retail development has moved closer to completing a tax abatement deal with the Dunwoody Development Authority, while one for the High Street project has been delayed.
The DDA last year gave initial approvals for agreements with the developers of both projects, where the authority acts as a bond issuing agency that allows them to gain property tax abatements over 10 years in exchange for meeting certain investment and job-creation goals. Both have been in a phase of negotiating over details of those agreements.
At its May 14 meeting, the DDA approved a 60-day extension of the negotiation deadline with GID Development Group for the abatement on the first phase of its long-stalled High Street project. The massive, $2 billion mixed-use project is planned for a 42-acre site at Perimeter Center Parkway and Hammond Drive in Perimeter Center. The developer and the DDA now have until the end of July to reach a deal on what was once — prior to the coronavirus pandemic — estimated to be a $19 million tax abatement.
At the same meeting, the DDA approved the agreement with Branch Properties for Perimeter Marketplace, a redevelopment of a 10-acre commercial site on Ashford-Dunwoody Road between Meadow Lane and Ashwood Parkway. The $45 million bond issuance would come with a tax abatement projected to be worth $2.3 million.
The deal requires the project to be open by 2023 — developer attorneys say it should be ready by 2021 — and sets job-creation goals. By the second year of operation, the project must create 225 jobs, and in years three through 10, it must create 325 jobs. The developer also must make its full, $45 million investment by years three through 10. For any year where the developer fails to meet those goals, the tax abatement will be revoked.
Another clause in the agreement that was a point of discussion, according to DDA attorney Dan McRea, was about force majeure — the legal concept that a party to a contract is not liable for failure to deliver when there is an extraordinary circumstance, such as a terrorist attack or natural disaster. Force majeure clauses have taken on special importance during the pandemic.
The agreement says that the developer can invoke force majeure up to two times in the 10 years as a reason for not meeting its required goals without penalty. However, doing so also extends the requirements by another year, so the developer will be required to meet them eventually.
Now that the legal agreement is done, bonds still must be issued as a final step.